Dean Russell MP: 'IR35 not a reason for businesses to discriminante'

Dean Russell, Conservative MP for Watford has said that the message needs to go to businesses that IR35 is not a reason for them to discriminate against contractors.

Mr Russell said this at the Houses of Parliament during the ‘Parliament Street Skills Summit-Closing the Gap’ talk which discussed the UK’s growing skills shortage.

Mr Russell said:

I am very aware of IR35 and have spoken to both Chancellors (Sajid Javid and Rishi Sunak) about it. The message needs to go to businesses not to discriminate against contractors.

The legislation is there to close a tax loop hole, it is not a reason to discriminate against contractors.

All “big four banks” in the UK have reacted to IR35 in the same way by placing a ban on the use of contractors.

When Mr Sunak announced his first ever budget on 11/03/20 he gave plenty of attention to COVID-19 but there was no mention of delaying IR35 to the displeasure of numerous contractor groups.

Dave Chaplin, CEO and founder of ContractorCalculator  and IR35 shield said:

Today’s news on Off-Payroll is exceptionally disappointing and demonstrates a tin-eared approach has been taken by the Chancellor.

Already we are seeing firms unfairly classify self-employed workers as ‘deemed employees’ which means they are taxed as employees, but yet receive none of the rights of employment.

On 06/03/20 the Recruitment and Employment Confederation (REC) and KPMG’s UK Report on Jobs February 2020 showed that temporary positions are falling for the second month running due to IR35. 

Also at the end of February, the Government concluded its review of IR35 which again was met with criticism as contracting groups called it out as “lip service”. Mr Sunak has said that the first 12 months of the legislation will not be “heavy handed”.

Mr Sunak said:

I’ve spent time with HMRC to ensure they are not going to be at all heavy handed for the first year to give people time to adjust as well, which I think is an appropriate and fair thing to do.

However, this just resulted in people calling for a delay to IR35.